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ELRCPartially AllowedMemorandum of Claim dated 2nd February, 2023· [2025] KEELRC 2866 (KLR)

Munguti v General Plastics Limited (Under Administration) & another (Cause E067 of 2023) [2025] KEELRC 2866 (KLR)

Employment and Labour Relations Court
22 October 2025
DMD. K. Njagi Marete
1,508 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court ruled a 29-year employee was unfairly dismissed without a hearing, awarding him over Kshs. 2.4 million in terminal dues and compensation.

What this practically means

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Executive summary

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The claimant, employed by the 1st Respondent from 26th November, 1992 as a Quality Controller and later rising to Quality Assurance Head of Department, alleged that his employment was terminated on 15th June, 2021 on grounds of cost-cutting following the company's receivership. He asserted the termination was malicious, biased and discriminatory, linked to his role as chairman of the staff Sacco whose monies the 1st Respondent had deducted from members but failed to remit, and that he was denied a hearing, contrary to sections 41, 43 and 45 of the Employment Act, 2007 and constitutional and ILO provisions. The claim proceeded undefended despite service and was determined on the claimant's written submissions. Framing three issues - whether the termination was wrongful, unfair and unlawful; entitlement to relief; and costs - the court found the termination contravened sections 41, 43 and 45 of the Employment Act and constituted an unlawful summary dismissal, adopting the twin tests of substantive justification and procedural fairness from the authorities cited. The claim was allowed in part: a declaration of unlawful summary dismissal was issued; notice pay of Kshs.70,000; June 2021 salary of Kshs.35,000; severance pay of Kshs.1,750,900; and eight months' compensation of Kshs.560,000 were awarded, totalling Kshs.2,415,900, with interest, a certificate of service within sixty days, and costs to the claimant. The maximum twelve months' compensation sought was reduced to eight months, and the claimed unpaid leave days were not awarded.

Key legal issues

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01

Whether the termination of the claimant's employment was wrongful, unfair and unlawful

Holding

Yes. The termination contravened sections 41, 43 and 45 of the Employment Act, 2007; the claimant was not granted a hearing and there was no fair substantive reason.

Reasoning

The matter was undefended despite service. The claimant testified through written submissions that he was served a show cause letter, responded, and was then terminated without a hearing. Relying on section 45 of the Employment Act and the authorities on substantive justification and procedural fairness, the court found the termination failed both limbs and was an unlawful summary dismissal, possibly victimization over Sacco-related deductions.

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02

Whether the claimant is entitled to the relief sought

Holding

Yes, but the court awarded eight months' compensation rather than the maximum twelve months, adjusted June 2021 salary to Kshs.35,000, and did not award the claimed unpaid leave days.

Reasoning

Having found unlawful termination, the court held the claimant entitled to terminal dues and compensation. It granted notice pay, June 2021 salary, severance pay, and eight months' compensation, plus a certificate of service, interest and costs.

p. 4

Legal principles established

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  • A termination of employment is unfair if the employer fails to prove that the reasons for termination were fair and that a fair procedure was followed, per section 45 of the Employment Act, 2007
  • Substantive justification and procedural fairness are the twin parameters for testing the fairness of a termination of employment
  • A termination that does not comply with sections 41, 43 and 45 of the Employment Act, 2007 is wrongful, unfair and unlawful

Court orders

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  1. 1.A declaration that the termination of the employment of the claimant by the Respondent was wrongful, unfair and unlawful and amounted to unlawful summary dismissal
  2. 2.The claimant is entitled to terminal dues and compensation for unlawful termination of employment
  3. 3.One (1) month's salary in lieu of notice of Kshs.70,000.00
  4. 4.Salary for June, 2021 of Kshs.35,000.00
  5. 5.Severance pay of Kshs.1,750,900.00
  6. 6.Eight (8) months' compensation for unlawful termination of employment of Kshs.560,000.00 (total of claim Kshs.2,415,900.00)
  7. 7.The Respondent to issue a certificate of service to the claimant within sixty (60) days from the date of the judgment
  8. 8.Interest at court rates from the date of judgment till payment in full
  9. 9.The costs of this cause to be borne by the Respondent
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over unfair and unlawful termination from employment; sections 41, 43 and 45 of the Employment Act, 2007

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Munguti v General Plastics Limited (Under Administration) & another (Cause E067 of 2023) [2025] KEELRC 2866 (KLR)", Case Analysis (2025). Memorandum of Claim dated 2nd February, 2023. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/2866/eng@2025-10-22

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.